Summary
Landowners of village Dharuhera, whose lands were acquired by a Section 4 notification of 12.12.2008 for Institutional Sector 5A, challenged the High Court's confirmation of compensation at Rs. 55,71,010 per acre. The Supreme Court held that the award for the adjoining Malpura-Kapriwas acquisition (finally fixed by this Court in BESCO at Rs. 1,49,14,975 per acre) could safely be taken as the base value with de-escalation for the 17-month gap and a deduction for change-of-land-use charges, and fixed compensation at Rs. 1,18,37,668 per acre with statutory benefits; eleven connected appeals were held directly covered by BESCO and Habitat Estates.
Issues
- Whether the High Court was right in holding that the award for the adjoining Malpura-Kapriwas acquisition (Section 4 notification of 13.05.2010) was not comparable and could not be used as the base value for the Dharuhera lands acquired under the notification of 12.12.2008.
- Whether the High Court could rely solely on one sale exemplar (Exh. PW4/D) and reject all other exemplars produced by the landowners and the State.
- Whether an award or judgment relating to a later acquisition of adjoining land can be relied upon, with appropriate de-escalation, to determine market value.
- What deductions (de-escalation for the time gap and change-of-land-use charges) should be applied to the base value.
Provisions considered
- Sections 4 and 6, Land Acquisition Act, 1894The Dharuhera lands were notified under Section 4 on 12.12.2008 with a Section 6 declaration on 11.12.2009; the adjoining Malpura-Kapriwas lands were notified under Section 4 on 13.05.2010 with a Section 6 declaration on 12.05.2011. The Court treated the difference in notification dates as a matter for de-escalation rather than a bar to using the later award as base value. (¶¶ 4, 5, 8, 33, 35)
- Section 18, Land Acquisition Act, 1894The landowners sought references under Section 18 for enhancement; the Reference Court enhanced compensation to Rs. 55,71,010 per acre by taking the Malpura award as the base and applying a 12% reverse deduction for the 17-month gap. (¶¶ 6, 9, 10)
- Sections 23(1-A), 23(2) and 28, Land Acquisition Act, 1894Statutory benefits under these provisions were directed to be paid on the redetermined market value of Rs. 1,18,37,668 per acre after deducting amounts already paid; land losers in the connected appeals were denied interest for the period of delay in filing or refiling their appeals. (¶¶ 37, 38)
Held
- An award or judgment fixing compensation for a different acquisition is relevant evidence but not binding; Manoj Kumar v. State of Haryana does not hold that such awards cannot be relied upon at all, only that they are a piece of evidence and not conclusive, and their basis must be examined. Where adjoining lands were acquired by a later notification for a similar purpose, the principle of de-escalation permits the later award to be used as the base value, as in Peerappa Hanmantha Harijan, Chandrashekar and Sardara Singh. (¶¶ 25, 26, 27, 28, 29, 30)
- The short order in Rajbir v. State of Haryana, which disapproved reliance on a subsequent acquisition with appropriate reduction, must be understood on its special facts; it does not show whether the lands there were proximate, adjoining or of similar character, and so does not assist the State. (¶ 32)
- Potentiality, that is the use to which the land is put or is reasonably capable of being put, must be taken into account in assessing market value. The Dharuhera lands were within a notified municipal area, adjoined the Malpura revenue estate across NH-8 and were surrounded by residential colonies, a school, a bus stand and commercial development, so their potentiality for multifarious use could not be disputed. (¶¶ 31, 33)
- The High Court's reasoning in relying only on exemplar PW4/D and in holding that the Malpura lands were not shown to be comparable was unsatisfactory: the sketch showed the villages were adjoining, both acquisitions were for development of sectors in Dharuhera by the same acquiring authority, and exemplars PW4/E and PW4/F were equidistant from the acquired land as PW4/D. Classification of compensation by the public purpose for which land is acquired is ordinarily impermissible, as observed in Nagpur Improvement Trust v. Vithal Rao. (¶ 33)
- The value fixed in BESCO Ltd. v. State of Haryana (Rs. 1,49,14,975 per acre) for the Malpura-Kapriwas lands can safely be treated as the base value for the appellants' lands, as the Reference Court rightly did; the test in Manoj Kumar is satisfied because the appellants' own exemplars showed comparable prices in Dharuhera even before the municipal notification. Applying de-escalation of 12% for one year and a further 6% for the remaining five months gives Rs. 1,23,37,668 per acre, a figure broadly confirmed by escalating PW4/E and PW4/F at 12% per annum from 29.05.2006 to 12.12.2008. (¶¶ 33, 34, 35, 36)
- Since the BESCO landowners had obtained change of land use and paid CLU charges, a rough and ready deduction of Rs. 5 lakh per acre is warranted, giving a market value of Rs. 1,18,37,668 per acre on which statutory benefits under Sections 23(1-A), 23(2) and 28 are payable after deducting amounts already paid. (¶¶ 37, 38)
- The eleven appeals arising from the Malpura-Kapriwas acquisition under the notification of 13.05.2010 are directly covered by BESCO and Habitat Estates and the land losers are entitled to the same benefits, but not to interest for the period of delay in filing or refiling their appeals. (¶¶ 4, 38)
Result
Appeals partly allowed. High Court judgment dated 20.09.2022 set aside; appellants in the sixteen Dharuhera appeals to be paid Rs. 1,18,37,668 per acre with statutory benefits under Sections 23(1-A), 23(2) and 28 of the Land Acquisition Act, 1894 after deducting amounts already paid. The eleven Malpura-Kapriwas appeals to be governed by BESCO (Civil Appeal No. 5376 of 2023) and Habitat Estates, without interest for the period of delayed filing or refiling. No order as to costs.